The demand for microwaves in a certain country is given by: D = 8,000 -30P, where P is the price of a microwave. Supply by domestic microwave producers is: S = 4,000 + 10P. Suppose the economy is closed. The equilibrium price of a microwave is ________ and equilibrium quantity is ________.

Question

Quizplus · Accepted Answer

In a closed economy, the equilibrium price will equate the quantity supplied and the quantity demanded. Solving 8,000 - 30P = 4,000 + 10P, we find that P*=100 and Q* = 5,000.

The Demand for Microwaves in a Certain Country Is Given